New banking laws kick in from August 1: What's changing
Starting August 1, 2025, India's Banking Laws (Amendment) Act brings in some major updates for public sector and cooperative banks.
The goal? Better governance, more protection for depositors, and stronger checks on how banks are run—stuff that actually impacts anyone with a bank account.
Coop banks can now have directors with substantial interest
If you're following how banks are managed, here's the scoop:
now only those with a "substantial interest" of ₹2 crore or more can become directors at cooperative banks—a huge jump from the old ₹5 lakh limit (which hadn't changed since 1968!).
Plus, directors (except chairpersons and full-timers) can now serve up to 10 years instead of just eight.
These tweaks aim to make sure there's better oversight and less room for conflicts of interest.
Public sector banks will have to hand over unclaimed money
Public sector banks will have to hand over unclaimed money—like dividends or matured bonds left untouched for seven years—to an investor fund that helps educate and protect people.
Also, these banks can now pay their auditors directly, which should mean better quality checks.
And they'll need to report key info to the RBI more often—think monthly or quarterly instead of just occasionally—helping keep things transparent and above board.
This TL;DR keeps it short but gives you the big picture on why these changes matter, especially if you care about trust and safety in your bank.